ECB Eyes Another Rate Hike as Inflation Outlook Remains Uncertain

European Central Bank (ECB) policymakers last month thought they would need to raise interest rates again in September to contain the fallout from the Iran conflict, according to the ECB's account of their July meeting.

The account showed that while decisions remained data-dependent, another rate hike was likely necessary unless the inflation outlook improved significantly.

In June, the ECB raised interest rates for the first time in nearly three years to show its determination to stop a war-led rise in energy prices from taking root in the economy. The current policy rate is 2.25%.

ECB board member Isabel Schnabel said earlier this week that data would determine how much further borrowing costs would need to rise, and sources told Reuters that ECB governors were ready to raise the policy rate again to 2.50% on September 9-10.